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evablogger [386]
3 years ago
13

The DeVille Company reported pretax accounting income on its income statement as follows:_____.

Business
1 answer:
Sonja [21]3 years ago
7 0

Answer:

Entries and their narrations are posted below

Explanation:

We will record assets and expenses on the debit as they increase during the year and will record liabilities and capital on the credit side as they increase during the year or vice versa.

<u>Journal Entries</u>

2018

Dr Tax Expenses                                      132000  

Cr Deferred Tax Liability (66000*30%)  19800

Cr Tax Payable (374000*30%)                   112200

2019

Dr Tax Expenses                                                  106,020  

Dr Deferred Tax Liability (66000-26400)*25%    9,900  

Cr Tax Payable (386400*30%)                            115,920

2020

Dr Tax Expenses                                                100500  

Dr Deferred Tax Liability (33000*25%)          8250  

Cr Tax Payable (430000-28000+33000)*25%  108750

2021

Dr Tax Expenses                                                117750  

Dr  Deferred Tax Liability (5600*25%)              1400  

Cr Payable (470000+6600)*25%                          119150

<u>Working </u>

2018

Accrued Income                    440000

Less: Instalment Revenue -66000

Taxable Income                 374000

2019

Accrued Income                360000

Add: Instalment collection 26400

Taxable Income                 386400

2020

Accrued Income                                 430000

Less: Interest from municipal Bonds -23000

Add: Instalment collection                  28000

Taxable Income                                 435000

2021

Accrued Income               470000

Add: Instalment collection 6600

Taxable Income                476600

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